Ethereum's new staking limit is not a risk to decentralization, says Consensys researcher
Ethereum's Pectra upgrade is characterized as a cleanup of validator operations, not a threat to decentralization. Validators' chances of proposing blocks or earning rewards remain proportional to their ETH holdings, with no new advantages for larger validators. The upgrade increases the staking limit from 32 ETH to 2,048 ETH, raising concerns about potential centralization. Pai notes that many validators operate multiple virtual keys from single machines, and consolidation could reduce the number of distinct validators to around 30,000. This streamlining allows stakeholders to focus on critical issues like lowering gas limits. The new staking limit may facilitate institutional participation in ETH staking, with financial institutions interested in Ether ETFs potentially benefiting from yield if staking is approved by the SEC. Analyst forecasts suggest that approval could have a modest impact on inflows, with broader performance issues for Ethereum remaining a concern.
